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Earlier this summer, Mark Zuckerberg warned staff at Meta that the company would be "turning up the heat" on underperforming employees as it faced "one of the worst downturns that we've seen in recent history."
What he didn't reveal was the stealth-like ruthlessness of the hot new temperature. According to a Wall Street Journal report, the Facebook owner has been quietly pushing out staff through reorganizations, and even some unimpeachable talent is being let go.
A Hard Thirty Days Night
Meta staffed up big time last year as the economy, and tech stocks, boomed. The company reported 83,553 employees at the end of the second quarter, or 32% more than a year before. Google-owner Alphabet reported 174,014 employees, up over 20%.
But this year, Zuckerberg's metaverse dreams got a dose of cold, hard reality. His firm reported its first-ever drop in revenue in the second quarter, and profits fell 36%. Meta's stock price is down a staggering 51% in 2022 and the company slashed its guidance for operating expenses multiple times. It has never explicitly stated the dreaded L word -- layoffs -- but according to the WSJ's sources, fewer people are turning up to work. Meta has reportedly been mandating employees subject to reorganizations to reapply for jobs within a month. Those who can't find another internal job are terminated -- traditionally, this practice was used to weed out underperformers, but that's changed:
- Employees who spoke to the WSJ said employees with stellar performance reviews have been let go, and that the moves could be a sign of more significant cuts to come. Meta reportedly wants to reduce costs by 10% within a few months, with much of that from employee cuts.
- Meta isn't alone: last week, Google told half of the 100 staff at its start-up incubator Area 120 that they had 90 days to find a new job within the company. In the spring, over 1,000 Google staff petitioned management to lengthen a 60-day internal job hunting period for 100 people in the company's cloud computing division.
Pyrrhic Victory: Meta's business troubles have been a tonic for its legal team. At a hearing this week for a forthcoming US antitrust lawsuit, Meta's lawyers said its declining stock value, struggles to compete with emerging rival TikTok, and revenue losses due to privacy changes by Apple are all signs that it's not so monopolistic after all. "Sometimes facts that are good for an antitrust defense are bad for business," Aaron Panner, Facebook's lawyer, told Reuters. Good look explaining that to Zuck.